Jefferies sees Newcrest not prioritising medium-term growth amid Newmont bid

National CineMedia

17/02/2023 24:47

** Analysts at Jefferies believe Australian gold producer
Newcrest Mining Ltd  NCM.AX  will prioritize short-term
production outcomes instead of focusing on medium-term
sustainable growth in order to defend the $16.9 bln Newmont bid 
    ** NCM shares up as much as 0.7% to A$24.060, in early trade
    ** NCM rebuffed Newmont Corp's  NEM.N  takeover bid on
Thursday, but left the door open for a better offer  urn:newsml:reuters.com:*:nL4N34V41R
    ** Australia's largest gold miner posts HY underlying profit
of $293 mln vs $298 mln a year ago, surpassing analysts'
expectations $184 mln, according to Refinitiv data 
    ** Jefferies cuts NCM price target to A$26.00 from A$27.00,
downgrades rating to "hold" 
    ** "The next play by a miner under takeover is to push its
assets hard, be that through high-grading, reducing spend on
pre-stripping, delaying sustaining capital spend or deferring
maintenance on plant and equipment,"- Jefferies 
    ** Brokerage flags increased risks for NCM to achieve its
medium-term production outcomes 
    ** Jefferies marginally increased NCM's FY23 gold production
expectations by 67 thousand ounces (koz) from 2.115 million troy
ounces (Moz) to 2.182Moz
    ** Downgrades FY24 NCM gold production by 57koz from
2.144Moz to 2.087Moz
    ** Stock up 15.8% this year, as of last close
 (Reporting by Roushni Nair in Bengaluru)
 ((Roushni.Nair@thomsonreuters.com;))